Posts Tagged ‘cost of infomercials’

What is the cost to produce an infomercial? Infomercial Production Costs 2011? You guys keep asking. TV Infomercial costs? Cost of infomercial media? The calls and emails and searches continue. Thanks for visiting the Infomercial and DRTV Blog – a good place to get straight, real information on the wacky, wonderful world of TV Infomercials. Let’s look at some different formats and talk about the range of TV Infomercial Production Costs.

Short Form DRTV: Short form TV Infomercials are actually TV commercials with a response mechanism like a toll free number or URL or both. These spots are available in :120 second and :60 second lengths with :30 seconds used mainly for TV lead generation. Production costs vary according to the Direct Response Agency or Production Company and other factors including camera equipment, size of crew, etc. Many short form direct response television producers charge about $30,000.00 plus a royalty. Beware of any producers less than $10,000.00 because too many corners must be cut. However, some companies bundle services together and provide media services in lieu of a royalty.

In addition to Short Form TV Production, other costs associated with a DRTV launch include: TV media costs, inbound telemarketing setup, fulfillment and payment processing, as well as duplication costs. As you can see, it starts to get a bit complicated so it’s always best to work with an experienced professional, not someone getting their feet wet with your project.

Long Form TV Infomercials: These are really TV shows! Since 1984 when the length of commercials was deregulated, marketers have had the ability to fully demonstrate, create emotional testimony, and make a complete pitch to truly sell their products. It’s a unique marketing platform and creates all the video assets needed for every other new media platform in the 21st century. Since you must produce about 30 minutes of content, these productions naturally cost more than short form. Rates are all over the place. Some of the best known infomercials may have a multi-million dollar celebrity and others may be shot in front of a black curtain. Costs range from the down and dirty (avoid this!) to the ultimate shoots on The Red One. Choose your producer wisely. Again, many producers must make a substantial profit on your show, while others may work close with you and gain their profits with a rollout and substantial media buying. Some product developers and owners are looking for “partners” to fund the production. If you want to keep control of your product be careful. TV Production costs and initial media tests are very affordable, and there are media funding companies who will assist with a roll out without any equity in the product.

OK, OK, now you’ve decided that your product can work in a short TV format. Great, but how long should your TV Commercial be? 30 Seconds? 60 Seconds? 120 Seconds? 5 Minutes? Wow…..let’s see if your Short Form DRTV Infomercial guru can help!

Let’s face it media rates will drive the success or failure of your project. Unless you are deeply funded and have a long term branding strategy like a beverage company or an automotive marketer, you need frequency and immediate results and sales. Let’s take a look at the benefits of each length in Short TV Infomercials.

5 Minutes or 360 Seconds:Pros: This format has many of the attributes of a Long Form TV Infomercial. You can tell a convincing story, include testimony that can touch emotional notes with customers, and still have enough time to pitch an irresistible offer. With this format you will have all the video assets necessary for shorter spots and interactive viewing on your web site.

Cons: The 5 minute format is in limited distribution. Most of the Discovery Networks offer them, including OWN as do many NBC Universal properties. But, there is not enough inventory for a full roll out. In addition, the short form TV media available make it difficult to fine tune your customer targeting which is a major benefit of Short Form DRTV spots.

2 Minutes or 120 Seconds:Pros: This format is the standard for As Seen On TV product launches. There is enough time for magic product demos and the spots usually make an offer pitch for about 20 seconds and then the telephone number is pitched for 15 more seconds.

Cons: The 2 minute format is in limited distribution. There’s no chance to get your product on Lifetime or USA, for example. Most of the major cables have limited 2 minute inventory. And the rate is 400% over the 30 second rate! The world is changing and shorter spots are the trend.

1 Minute or 60 Seconds:Pros: Goldilocks was looking for something that was “just right”. In one minute you can show negative shots, solve the problem, include multiple demonstrations and pitch a compelling offer. There’s not a second to be wasted, though. No time to say “call now” several times, no time to pitch the toll free number twice. But, nowadays 30% to 65% of the sales will come from e-commerce. Make no mistake, our world is changing, and the consumer knows that they do not have to call now. There is a lot inexpensive, cheap, if you will, media availability. Your spots can air on Lifetime or any other major cable network in a variety of distribution networks. Heck, we can get these on the air in over 27,000,000 homes for as little as $20 per spot.

Cons: You cannot waste one second or one word. If you have a high priced product, you need more time. The short form media cost is double the 30 second rate.

30 Seconds:Pros: These spots are usually considered branding spots. However, we have been successful many times using 30’s for lead generation and a drive to the web. There is more inventory in this format at the lowest cost per spot than any other length.

Cons: You cannot sell a product directly with this length. There is just not enough time to tell the story and ask for the sale. Your messaging must be perfect and the call to action must be short.

So here is the Ron Perlstein 2011 media cost update. The 4th quarter of 2010 finished strong with rates pushing higher in short form DRTV. Media rates during the first three weeks of January, 2011 came down about 10% from late fourth quarter and are now gradually making their way back up. January was surprisingly strong with rates on networks like CNBC and BRAVO working their way higher.

What about long form TV infomercial rates? Well, it’s kind of the same story, just different reasons. Half hour paid programming rates were on the decline in 2009 and 2010. As a result, TV networks, especially Discovery owned networks have replaced infomercial airtime with programming. Discovery Health has become OWN (Oprah Winfrey Network) with no long form paid programming. Bottom line — long form rates are firming up now, too.

DRTV media is a fluid marketplace that changes as the conditions and basic law of supply and demand change. Stay tuned for more updates as 2011 unfolds.

Please follow this blog regularly over the next days and weeks because I will disclose and describe to you the step by step process involved in a real long form infomercial project. From the cost of a long form infomercial, to the development and writing of an infomercial, and other infomercial production issues such as infomercial hosts, infomercial sets, straight through to long form infomercial media planning and infomercial telemarketing, fulfillment and logistics. The first part of the process starts when a new client contacts us to discuss their infomercial project. We must determine if the product has the attributes necessary for As Seen On TV Success. We usually ask the client to fully describe their product from the first call, and many are hesitant unless there is a NDA in place. At InfoWorx Direct, we provide a standard NDA which you can download from our site. At the time of the first contact, a discussion takes place as to the chances of success and which format: short form direct response commercials or a long form infomercial is best for your product. Often clients are hesitant to spend the extra dollars necessary for a long form production when that is the appropriate format. Do not make that mistake because it will set up a series of failures sure to derail the success of your infomercial project. Short form infomercial production can cost as little as $5,000. Successful lead generating programs often generate a substantial response with very simple production values and a great lead generating offer. On the next blog in this series, we will discuss different long form infomercial production values and the costs of production for those types of shows. And I will continue to take you step by step through our current project which we will call “Fitness Infomercial 2010.”

My how time flies! It seems like it was yesterday that we were just starting out in 2010 with new dreams, plans and projects. At InfoWorx it’s been extremely busy, profitable and exciting. Our clients bring us innovative products that solve problems and make life easier. That brings me to some infomercial money making tips for 2010.

1. If you want to launch your product in 2010 – NOW is the time. Infomercial projects take anywhere from six weeks to six months. You should be ready to test in August to roll out in the last third of the year – when everyone is back in school and at work.

5. Remember, THE OFFER IS KING. You could have great creative and a problem solving product that’s new and innovative…..but unless your offer is packed with value, sounds almost too good to be true, and has upsells or line extensions your infomercial will not have a good chance for success.

Stay tuned. Bookmark or subscribe to this blog and come back here often. There’s still time to maximize the improving economy but now is the time to have a chance at success in 2010.

“How many airings will we get?” “I think my infomercial media should air on Lifetime.” “How much does infomercial media cost?” The questions keep coming, and we have the answers here at the DRTV and Infomercial blog.

Lets start with some basic information. The largest and best known cable networks now reach about 90 million TV households in the USA. Broadcast networks have been losing audience to cable for a generation. So make no mistake, the best known cable networks have plenty of demand for their limited inventory from the largest brand marketers out there. For example, back in January a :60 second direct response spot on HGTV would clear for about $2500.00 with :120’s costing double. The rates go up each month as we closer to second quarter. Remember, when it comes to media, it’s all about supply and demand. And even the nest media agencies have to pay the rate that will clear. Cable networks do not give their inventory away because they like the agency.

When selling a product with a hard offer, it is generally known that a two-minute infomercial will work the best — so as you can see large networks are not efficient methods of testing and may not be the best medium until you have a large roll out in retail.

We generally recommend media tests in the $10,000 to $20,000 range using the most efficient media available, which is usually lower tiered national cable networks, not local cable.

Using the example above, we ran our client on DIY (which is owned by the same cable family as HGTV) but has a smaller cable footprint and is much more infomercial and direct response friendly. We were able to clear on DIY at rates from $250 to $700 for two-minute airings.

Another efficient media buying strategy is satellite networks like DirecTV and DISH. These networks work best for lead generating offers because they do not have 2 minute inventory available. You can buy 26 HD cable networks on DISH for as low as $50 per :60 second airing.

Infomercial media rates change on a daily basis, and the market is fluid and demand is heavy even in this tepid economy. You see it pays to advertise and everyone realizes that TV infomercials are effective channels of distribution

As online video grows, and it’s audience grows, more data is available as to who and how often they are watching. Remember infomercials and direct response television are all about the metrics. Cost per order, cost per lead, cost per acquisition. As we at InfoWorx drill down into the vast new opportunities for infomercial products, we are finding many online video ad networks who are willing to work on a cost per acquisition model. Sometimes however, working at an auction based level with a low CPM can be even more effective then direct response rates found on mainstream TV.

As new data comes in, check this blog frequently. In order to reach 21st century customers, you need a scientific approach that targets your best customers with the lowest cost per order. Online video now offers a new and exciting method to drive your brand straight to your web site with an irresistible offer.

An experienced direct response agency or infomercial company can target your best prospects, create high powered messaging that brings high response and get your phones ringing with new prospects ….. hot for your offer.

Smart media buyers can then distribute your lead generating offer through per inquiry campaigns across many channels including unsold television remnant time, online video ads, and even radio and print.

Your direct response TV agency should have experience rolling out lead generation programs in both long form infomercials and short form direct response TV commercials. Direct response television lead generation is effective for many industries such as: insurance, mortgages, hair replacement, cosmetic surgery, and senior products.

For 16 years, I’ve been helping entrepreneurs understand the dynamics of direct response television or DRTV. Nowadays everyone refers to short form direct response commercials and long form infomercials as simply infomercials. But make no mistake they are different infomercial formats, with different ways of targeting customers to make your product an as seen on TV success. Here’s 7 tips for making money with TVinfomercials and DRTV spots.

1. If you have a single SKU product, find some other products to work your offer and create an upsell stream of revenue.

2. TV infomercials are much more then TV production and media. Remember that a successful infomercial campaign includes telemarketing to convert leads to orders, payment processing, fulfillment, customer service and e commerce web sites. Look for a turnkey infomercial shop with a successful track record.

3. Direct to consumer selling is a science. You must conduct research to understand your most profitable customer. Then, test more then one offer, price point, and upsell strategy. An agency with experience and the ability to move quickly can help get your product out to market faster.

4. Make sure you have adequate funding. Today smart direct response companies can utilize the latest technologies and produce award winning infomercials with limited budgets. But you must have adequate funds to test an offer, tweak the creative and telemarketing scripts and re-test. Be patient.

5. When you hire a good TV infomercial company, listen to their advice. They are on your team and know a lot more about what works and what doesn’t.

6. Beware of infomercial companies offering joint ventures. Usually these deals are simply a hook to sell you a cheap TV production that will never go anywhere. Your direct response agency should have years of experience, a good reputation and offer services for a legitimate fee.

7. Be clear on your goals and objectives. Is your product a direct to consumer product with an ongoing revenue stream and continuity offer? Or is your product better for direct to retail — using retail sell through as the back end profit center? Make sure your TV marketing strategy fits your product line and team strengths.

There is much power in TV and Internet TV infomercial promotions. You can launch a new product on a nationwide stage faster and cheaper then any other marketing method. Media delivery is more efficient and targeted then ever before. Now it’s your turn to introduce your dream product and make money on TV.